Structured Process Analysis

Structured Process Analysis

A structured business process is defined as standardized procedures that govern day-to-day operations such as accepting returns, placing orders, purchasing raw materials, and more. Among the various structured processes executed within Amazon warehouses, our focus will be on the order sortation process. Amazon's order sorting procedure involves the grouping of packages by zip codes and towns within sortation facilities after packaging and labeling. Employees utilize tools such as pallet jacks, conveyor belts, and containers to scan packages and allocate them accordingly. Once sorted, the packages are loaded onto trucks and dispatched to customers, ensuring timely delivery and upholding Amazon's one and two-day shipping promises.

Step 1: Inbound ( Receiving )

Step 2: Unload Trailers

Step 3: Picking packages and sending transporting them onto conveyor belts

Step 4: Scanning packages and placing in containers to go to the next station

Step 5 : Packages placed in distinct containers for shipping ( outbound sorting )

Step 6 : Loading packages into trucks

Step 7: Outbound (Leaving)

All of this falls under the inter-enterprise scope of the overall fulfillment process, as Amazon collaborates with numerous smaller companies that rely on Amazon for transportation and delivery of their products. While this process has proven successful and efficient, it can also encounter challenges. According to Amazon, same-day deliveries increased by 65% by the end of 2023 (Meisenzahl, 2024). However, issues such as late truck arrivals, inter-station item transfers, conveyor belt maintenance, minimizing damaged goods, and machine malfunctions could potentially decrease the efficiency of the sortation process over time.

Warehouse Management System

The warehouse management system is the information system that Amazon uses inside the warehouse sortation to support the process.

The five components of the information system:

• Hardware: The Zebra MC33 mobile computer scanner has been used inside the Amazon warehouse to scan the package’s barcode and transform a physical image or document into a digital one that a computer can read.
• Software: Amazon uses custom software (AWS) to control the process. However, the TPH tracker is the one that they use to measure shift performance. The TPH stands for Throughput per hour and measures employee rate scan every five minutes segment. The formula to calculate TPH is Volume/labor hours.
• Data: All information used during the process, such as barcode, container IDs, package labels, trailer IDs, etc.
• People: Amazon employees who manage hardware and software during the process.
• Procedure: The way that Amazon Warehouse uses to combine hardware and software through the Management Information System.

Information Silo

A silo refers to a situation where data or information is not shared effectively between different departments or processes within an organization. This lack of communication and collaboration can lead to isolated pockets of information within each department, hindering overall organizational efficiency and decision-making. In the context of Amazon Warehouse's operations, silos are avoided due to the comprehensive sharing of information among various departments involved in the process. Information related to inbound and outbound operations, sorting, problem-solving, inventory management, and transportation is shared seamlessly across departments. This sharing of information is facilitated by the Information System employed by Amazon Warehouse. The IS not only connects all departments but also ensures the smooth flow of information between them, thereby eliminating silo issues and promoting interconnectivity within the organization.

CRM, ERP, & EAI

Customer Relationship Management (CRM) encompasses a suite of application databases tailored to manage interactions with customers throughout various phases, including marketing, customer acquisition, relationship management, and addressing loss/churn. On the other hand, Enterprise Resource Planning (ERP) constitutes a suite of applications primarily geared towards integration. These ERP systems play a pivotal role in supporting enterprise-wide processes spanning inbound and outbound logistics, manufacturing, sales, marketing, and customer service. In addition, Enterprise Application Integration (EAI) serves to facilitate integrated information sharing and communication across diverse systems within an organization. By connecting disparate system "islands," EAI provides an integrated layer atop existing systems, ensuring seamless functionality preservation. Notably, the major ERP vendors include SAP, commanding a significant 20% market share, followed by Microsoft with 14%, Oracle with 9%, Infor ERP with 7%, and Epicor with 4%. Amazon leverages several ERP vendors, including SAP, Microsoft, and Infor ERP, to support its operations.

Inter-Enterprise Information Systems

An Inter-Enterprise Information System (IEIS) is designed to facilitate communication, data sharing, and collaboration between two or more independent organizations. Amazon utilizes supply chain management systems to manage the flow of goods and services, from suppliers to manufacturers to warehouses, and finally to customers. “Supply Chain by Amazon” includes everything from warehousing and fulfillment to transportation and logistics. Amazon has various services under its supply chain umbrella, such as Fulfillment by Amazon, which allows sellers to store their products in Amazon’s fulfillment centers and have Amazon handle the packing, shipping, and customer service. Additionally, Amazon also has services like Amazon Flex, a platform for independent contractors to deliver the Amazon packages.